LinkedIn is the leading B2B social platform used by millions of people and businesses. It lets you connect with more than 850 million users via LinkedIn advertising. While running ads on LinkedIn to reach your target audience isn’t necessary, LinkedIn advertising helps you connect with a larger audience quickly.
What you can achieve with LinkedIn ads in a week would take months if done organically on LinkedIn. However, LinkedIn advertising offers a lot more to your brand…
LinkedIn Advertising Benefits
Here are the key benefits of advertising on LinkedIn:
- Ad types
LinkedIn advertising gives you access to a global audience that’s consistently growing at a steady pace. Over 190 million people in the U.S. are registered LinkedIn members, more than any other country in the world, and using the advertising platform has a potential audience reach of 850 million.
The best thing about LinkedIn is that it is used by professionals, including businesses. This is a reason why 93 percent of B2B marketers consider LinkedIn to be the most effective social media platform for lead generation and 51 percent of brands acquired a customer via LinkedIn.
It is also a great source for businesses to find and connect with business partners and build networks.
LinkedIn collects a lot of information about its users, and this helps brands with advanced targeting. You can target people based on location, LinkedIn activity, company name, demographics, and much more.
You can use account targeting that lets you connect with specific target accounts that you have uploaded based on your requirements. You can also target specific companies or a single company only and show ads to people who work in that company.
This type of granular targeting at the B2B level is extremely hard to find with any other ad network.
3. Ad Types
You can run different types of ad campaigns with LinkedIn, including content ads, messaging ads, lead generation forms, and dynamic text ads.
Each of these categories offers multiple ad types to help you achieve your advertising goals. For example, you can run video ads and single-image ads to interact with your target audience via sponsored content.
LinkedIn gives you access to analytics and lets you monitor ad performance via its easy-to-use performance dashboard.
You can track key metrics and ROI with a few clicks, but most importantly, it helps you better understand your target audience. Imagine you are building buyer personas: You can get tons of data from LinkedIn advertising reports.
You will find a lot of opportunities in the Company Engagement Report in your advertising dashboard. It helps you identify new business opportunities.
LinkedIn Advertising Costs
Your LinkedIn advertising cost depends on two factors:
- The average cost per objective
- Your budget
LinkedIn charges you based on your advertising objective. And it uses three models for it:
Essentially, it all comes down to CPC. The benchmark CPC globally for 2022 is $5.58. This varies based on job functions. For example, IT has a significantly high CPC as compared to other job functions:
The minimum daily budget for LinkedIn ads is $10. This means you’ll need to adjust your budget based on the number of clicks you are expecting.
For example, if you need to receive 100 clicks per day, your daily advertising budget should be around $500.
There are other LinkedIn advertising costs, too, such as:
- Ad format and type
- Bidding strategy
- Target location
- Ad creation and design cost
- Ad management
No two brands (even in the same industry) have the same cost for LinkedIn advertising. This is because the actual cost is based on several variables that are hard to control and predict upfront.
At the end of the day, you need to justify your LinkedIn advertising costs by proving a positive ROI and ROAS. If you can do it, you are heading in the right direction.
Tips for LinkedIn Advertising Cost Optimization
Here are a few tips and best practices to control your ad spending on LinkedIn:
1. Bidding Strategy
Choose the right optimization goal and select the appropriate bidding strategy. There are three bidding strategies to choose from:
- Maximum delivery
- Target cost
- Manual bidding
If you are interested in optimizing LinkedIn advertising spending, go with manual bidding. It lets you set CPC, CPM, or CPS manually (based on what you can afford). It helps you keep things under control.
It does impact visibility and ad impression, but you can control ad spend.
2. Daily/Lifetime Budget
This might sound too obvious, but a lot of brands make the mistake that they set a daily budget and don’t set a campaign ending date. This lets your campaign run indefinitely, and you might forget to pause it.
The lifetime budget is the best model as there is no room for overspending. You need to set a lifetime budget for your campaign, and it will end when the budget is consumed.
This helps you control LinkedIn advertising costs.
3. Ad Relevance
LinkedIn uses the quality score to determine ad relevance. Ads that are highly engaging and relevant to the audience's needs have lower CPC.
You can determine ad relevancy via Campaign Quality Score on LinkedIn. A high score means your ads are relevant to the target audience, and you will end up being the lowest bidder in the auction.
Create better and highly engaging ads (better than your competitors) to improve ad relevancy.
4. Switch to CPM
You need to change your bidding strategy from CPC to CPM at the right time for the right campaigns.
All ads with CTR above 1 percent should be converted to CPM. This will help you save a lot of money. This is because you will be charged based on impressions instead of clicks. And your ads have already proven to work well (with high CTR), so with the CPM model, they will still drive clicks without paying for each click.
5. Split Test
Test and tweak your ads.
Run multiple ads and keep them tweaking to see what works best. Your prime objective should be to find ads with high CTR, as it helps you in two ways:
- High CTR means better ad relevancy leading to a low bid.
- High CTR ads can be switched to the CPM bidding model for cost optimization.
You need to test targeting, creatives, headings, description, and pretty much everything. Keep doing it to find winning ads.
What Metrics to Measure on LinkedIn Advertising
There are several key metrics you need to track and measure to monitor the performance of your ad campaigns. These include:
- Cost per conversion
- Average engagement
Most of the metrics are available by default in the LinkedIn performance dashboard, such as clicks, CTR, impressions, etc. There are others you can track by setting up conversion tracking and lead gen forms, such as cost per conversion and cost per lead.
Metrics like ROI and ROAS need to be calculated based on your ad objective. You need to do it manually by tracking each click and setting up an attribution model in Google Analytics. This will help you better understand how each click from LinkedIn advertising contributed to revenue.
If you need help with LinkedIn advertising and cost optimization, we can help. Reach out us and we'll get you started.